Pt Bank Mandiri (persero) Tbk · IDX:BMRI
Pt Bank Mandiri (persero) Tbk — FY2003 Earnings Presentation
45 slides from Pt Bank Mandiri (persero) Tbk's earnings presentation, Jun 1, 2004
Slide 1: PT Bank Mandiri (Persero) Tbk. Results Presentation, Full Year 2003
PT Bank Mandiri (Persero) Tbk. Results Presentation, Full Year 2003 0
Slide 2: Bank Mandiri Overview: Operating Highlights & Financial Performance
Bank Mandiri Overview Operating Highlights & Financial Performance FY 2003 1
Slide 3: Key Balance Sheet Items and Financial Ratios
Key Balance Sheet Items and Financial Ratios IDR tn / % Dec 2002 Dec 2003 % Change Gross Loans 65,417 75,943 16.1 Government Bonds 148,846 122,907 (17.4) Total Assets 250,395 249,436 (0.4) Customer Deposits 184,114 178,811 (2.9) Profit After Tax 3,586 4,586 27.9 RoA - before tax (p.a.) 2.3% 2.8% RoE
Slide 4: Full Year Loan Growth of 16.1% is Generating Stronger LDR
Full Year Loan Growth of 16.1% is Generating Stronger LDR Consolidated Quarterly Data Growth (%) (7.7) 2.6 1.7 3.4 10.6 (13.6) 13.7 (0.1) 4.4 13.1 14.7 5.0 (2.7) 8.7 4.6 100 50% 42.5% 40.4% 80 36.1% 40% 35.4% 75.9 Loans, Rp. Trillion 72.6 28.3% 68.7 66.8 60 26.5% 27.5% 65.4 30% 26.3% LDR Ratio 25.3%
Slide 5: Q4 Loan Origination Remains Sound
Q4 Loan Origination Remains Sound Total Loan Growth (12 Mo. ‘03) – Bank Only IDR tn Total Loan Growth (Q4 ‘03) – Bank Only 1,499 1,467 +5.9% 2,054 78 371 1,067 73,311 +22.5% +14.7% 4,190 +3.9% 14,390 63,941 27,080 27,134 (FX Loans) (FX Loans) 46,177 43,401 (Rp Loans) (Rp Loans) Beg. Net New F/X Impa
Slide 6: Loan Portfolio Growth is Well Diversified
Loan Portfolio Growth is Well Diversified Loan by Customer Type – Bank Only ! Rp 2.9 trillion of the loan book (or 4.0%) IDR tn reallocated from Corporate to Commercial -4.5% YTD Growth in Q4 based upon customer GAS 45 42.7 41.8 ! Target loan mix by 2004 (originally 2007) 40.2 40.6 "Corporate: 50% 4
Slide 7: Loan Portfolio Analysis
Loan Portfolio Analysis Breakdown By Sector, December 2003(1) ! No sector accounts for more than Trading & 13% of total loans Others Restaurant 9.6% 10.2% ! Minimizing exposure to problem Mining Hotels 3.6% 1.5% sectors including Mfg - Wood 3.9% "Textiles (7.5%) Agriculture Mfg - Cement 12.9% "Plywo
Slide 8: Loan Collectibility Shows Decline in Category
Loan Collectibility (Bank Only) shows Decline in Category 2 NPL % Cat 2 % 100% 100% NPLs & Cat. 2 as% of Total Loans 80% 80% Loans by Collectibility (%) 60% 60% 40% 35.7% 40% 26.2% 24.8% 19.8% 20% 15.0% 20% 9.8% 8.8% 7.3% 0% 0% Q1 '00 Q2 '00 Q3 '00 Q4 '00 Q1 '01 Q2 '01 Q3 '01 Q4 '01 Q1 '02 Q2 '02 Q3
Slide 9: Asset Quality: Provisioning Coverage
Asset Quality NPL Movement - Consolidated ! Conservative provisioning " 139% coverage of NPLs as of Dec 31 65% 260% 2003 60% 240% " Mandiri provisioning policy results in Rp. 3.4 tr. in excess of BI requirement 55% 220% 50% 190.4% 200% By Collectibility 1 2 3 4 5 45% 180% Provisioning Coverage BI Re
Slide 10: Q4 2003 Loan Detail: Loans downgraded to NPL
Q4 2003 Loan Detail*: Loans downgraded to NPL Profile of Loans Downgraded to NPL in Q4 – Bank Only Rp 3.2 trillion in loans (4.4% of total loans) were downgraded to NPL in Q4, including Rp 100% 1.7 trillion for Kiani Kertas . At the same time Agri Other WC 1st Time Rp 1.0 trillion were upgraded from
Slide 11: Q4 2003 Movement in Category 1 and 2 Loans
Q4 2003 Movement in Category 1 and 2 Loans Category 1 Loan Movements – Bank Only Category 2 Loan Movements – Bank Only IDR bn 55,849 1,965 * 83 50,060 2,404 243 3,344 6,488 15,179 6,488 2,404 1,238 10,983 307 21 797 Beg. Bal. D/ Gt o 2 U/ Gf rom D/ Gt o U/ Gf rom Net FXImpact End Bal. Beg. Bal. Cat.
Slide 12: Q4 2003 Loan Detail: Category 2 Loans
Q4 2003 Loan Detail*: Category 2 Loans Category 2 Loan Profile – Bank Only Rp 10.98 trillion in loans were in 100% Other IBRA Restruct. Category 2 in Q4, or 15.0% of total 61+ Others loans. Of the Corporate & Commercial 90% IBRA Loans in Special Mention in Q4: Bus. Serv. WC 80% 31-60 Corp ! 69% are
Slide 13: 2003 Movement in Restructured Loans
2003 Movement in Restructured Loans Q4 2003 Restructured Loan Movements FY 2003 Restructured Loan Movements IDR bn 29,542 2,424 508 1,761 25,598 370 910 1,878 156 487 23,987 23,987 Beg. Bal. New Repayment Writ e-Of f s Ot hers* End Bal. Beg. Bal. New Repayment Writ e-Of f s Ot hers* End Bal. Rest ru
Slide 14: Q4 2003 Loan Detail: Restructured Loans
Q4 2003 Loan Detail*: Restructured Loans Restructured Loan Profile – Bank Only Rp 23.99 trillion in restructured loans remained in Q4, or 32.7% of total 100% 5 U/G to PL 4 Bus. Servs. EUR D/G to NPL loans. Of the Corporate & Commercial 3 Mfg-F&B 90% Restructured Loans in Q4: Mfg-P&P 80% Comm ! 90% a
Slide 15: Q4 2003 Loan Detail: Non-Performing Loans
Q4 2003 Loan Detail*: Non-Performing Loans Non-Performing Loan Profile – Bank Only Rp 6.48 trillion in NPLs remained in 100% Q4, or 8.8% of total loans. Of the Soc. Services IBRA Restr Corporate & Commercial NPLs in Q4: 90% Mfg-Cem WC ! 55% are to Commercial Mfg-Text 80% USD IBRA customers Corp Mfg-
Slide 16: Recap Bond Portfolio
Recap Bond Portfolio At Fair Value, Available for Dec 2003 (IDR tn) Trading HTM Total % of Total Sale Fixed Rate 0.1 27.3 1.4 28.8 23.4% Variable Rate 1.3 24.1 59.7 85.1 69.3% Hedge Bonds - - 9.0 9.0 7.3% Total 1.4 51.4 70.1 122.9 100.0% % of Total 1.1% 41.9% 57.0% 100.0% Bond Portfolio Movement (Fa
Slide 17: Growing Contribution from Loans vs. Bonds
Growing Contribution from Loans vs. Bonds – Bank Only Int. from Bonds Int. from Loans 100% 100% As a % of Total Interest Income 80% 74.9% 75.4% 74.7% 74.1% 80% 68.2% 67.8% 63.6% 60.6% Total Assets (%) 60% 60% 40% 40% 34.1% 29.9% 20% 20% 22.1% 19.8% 19.0% 18.1% 19.0% 19.3% 0% 0% Q1 '00 Q2 '00 Q3 '00
Slide 18: Funding Mix Improves
Funding Mix Improves Deposit Analysis – Bank Only Deposit 148.1 152.9 154.6 163.0 176.9 173.1 170.0 189.8 186.4 182.6 183.6 183.3 186.3 183.0 177.7 176.2 Total (Rp Tr) 100% 75.0% 90% 67.5% 80% 60.0% 61.5% Deposits by Customer 70% 57.3% 52.5% Deposits by Type 56.2% 53.7% 51.7% 60% 48.7% 45.0% 46.4% 4
Slide 19: Savings Deposit Growth Generating a Better Funding Mix
Savings Deposit Growth Generating a Better Funding Mix Savings Deposit Growth Average Monthly Rupiah Deposit Costs 45 45% 20.0% 40.5 17.3% 40 40% 17.5% 15.9% Savings Deposits, Rp. Trillion 17.2% Rp Time Deposits 35 35% 15.0% 13.8% 29.6 15.1% 30 30% 11.6% 1-Mo SBIs 12.5% 13.0% 25 22.8%25% 22.1 10.0%1
Slide 20: ATM, Credit Card and Phone Banking Growth
ATM, Credit Card and Phone Banking Growth ATM Network Average Daily Transaction Volume and Value 98,004 500,000 100,000 88,310 Avg. Daily Transaction Avg. Daily Transaction Value (Rp. Millions) 400,000 80,000 Avg Daily Volume Avg Daily Value 62,551 Volume 300,000 271,764 268,706 60,000 41,744 226,22
Slide 21: A Strong Capital Base to Support Growth
A Strong Capital Base to Support Growth CAR BI Min Req 100 35% 91.9 32.2% 89.5 31.4% 31.3% 29.3% 29.3% 29.8% 79.5 28.5% 77.8 30% RWA/Total Capital, Rp. Trillion 80 28.6% 27.9% 27.7% 26.4% 72.5 26.6% 26.4% 26.1% 64.3 61.0 23.4% 25% 58.1 60 56.1 CAR 51.3 51.6 47.0 20% 44.0 42.3 42.6 40 15% 25.0 25.5 2
Slide 22: Maintaining Margins Despite a Fluctuating Interest Rate
Maintaining Margins Despite a Fluctuating Interest Rate All figures - Bank Only 13.9% 13.6% 13.5% Cost of Funds & Yield on Earning Assets – Bank Only 14% 13.0% 13.0% 13.0% 14% 12.6% 12.8% 2.1% 12.4% 2.0% 2.5% 11.9% 11.8% 1.7% 2.2% 2.2% 2.2% 1.5% 11.5% 1.1% 12% 11.3% 12% 10.9% 1.8% 0.8% 11.8% 11.6% 1
Slide 23: Rising Non-Interest Operating Contribution
Rising Non-Interest Operating Contribution IDR bn 750 600 395 450 327 300 250 16 258 178 294 172 236 85 115 150 101 339 78 302 282 55 91 162 173 180 190 32 135 112 150 102 101 89 89 46 57 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 '00 '00 '00 '00 '01 '01 '01 '01 '02 '02 '02 '02 '03 '03 '03 '0
Slide 24: Overhead Spending Remains Under Control
Overhead Spending Remains Under Control Despite Heavy Investment in Brand & IT Platform 2,500 75% 70.5% Cost to Income Ratio Annual Avg Overhead Expenses (Rp.Billion) 2,000 60% Cost to Income Ratio 44.9% 45.8% 1,500 39.9% 42.5% 41.8% 45% 37.1% 37.1% 42.8% 40.4% 33.8% 34.4% 38.9%40.8%40.0% 31.1% 36.9
Slide 25: Scale Brings Efficiency Advantage Over Our Competitors
Scale Brings Efficiency Advantage Over Our Competitors Bank Only, As of September 2003 Loans/ Employee Revenue/ Employee Cost/Assets (Rp Mn) (Rp Mn) (%) 3,956 906 4.2 3,754 3.7 3.4 3,1072,930 634 2.7 2.3 2.4 474 2 2.1 1,726 1,5571,468 1,347 297 295 291 275 1.5 1,1381,102 1.2 194 192 186 BTN BII BTN
Slide 26: Growth in Core Earnings Shows Brand Franchise Strength
Growth in Core Earnings Shows Brand Franchise Strength IDR bn 7,500 Gain on Sale/Value of Securities FX Gain 2,072 Pre-Provision Operating Profit 6,000 Core Earnings 114 4,500 2,021 260 1,454 3,000 5,332 4,145 3,357 3,514 1,500 0 2000 2001 2002 2003 25
Slide 27: Consistent Improvement in Profitability: FY PAT of Rp 4.586 tr
Consistent Improvement in Profitability: FY PAT of Rp 4.586 tr IDR bn 5,500 26.2% 27.5% 24.0% 25.0% 21.5% 4,500 22.5% 819 Return on Equity 20.0% Profit after Tax 3,500 17.5% 799 645 1,528 15.0% 2,500 12.5% 1,017 8.1% 967 10.0% 690 1,500 602 7.5% 829 1,300 5.0% 290 1,549 500 1,168 2.5% 472 308 0.0% (
Slide 28: Potential Upsides
Potential Upsides ! Aggregate of IDR 20.4 tn (US$ 2.42 bn) in written-off loans as of end- December 2003, with significant recoveries on-going: Written-off " 2001: IDR 2.0 tn (US$ 224 mn) Written-off Loans Loans " 2002: IDR 1.1 tn (US$ 123 mn) " 2003: IDR 1.2 tn (US$ 147 mn) ! Property revalued by R
Slide 29: Corporate Actions
Corporate Actions ! 50% Dividend payment policy maintained ! Based upon Full Year EPS of Rp 229: Dividend Dividend " Total Dividend Payout expected : Rp 115 Policy Policy " Less Interim Dividend paid in Dec 2003 : Rp 50 " Final Dividend expected after approval : Rp 65 from AGM scheduled for May 2004
Slide 30: Additional Prudential Supervision Requirements
Additional Prudential Supervision Requirements Jan Jan 2004 2004 Ratios/Benchmarks Ratios/Benchmarks Requirement Requirement Dec Dec 2003 2003 (Unaudited) (Unaudited) Secondary Secondary Reserve Reserve ≥ 12% 12% 8.2% 8.2% 10.8% 10.8% CETA CETA (Annualized) (Annualized) ≥ 1.5% 1.5% 2.17% 2.17% 2.49%
Slide 31: In Conclusion
In Conclusion ! Better Asset Mix ! Better Liability Mix ! Retail Banking Growing ! Margins Improving ! Scale Provides Cost Efficiency Advantage ! Transformation in Corporate Governance, Risk Management and Corporate Culture Continues 30
Slide 32: Bank Mandiri Financial Summary Full Year 2003
Bank Mandiri Financial Summary Full Year 2003 31
Slide 33: Summary P&L Information – Full Year 2003
Summary P&L Information – Full Year 2003 FY 2002 FY 2003 % of % of Rp (Billions) Av.Assets* Rp (Billions) Av.Assets % Change Interest Income 31,879 12.6 25,557 10.0 (19.8) Interest Expense (25,017) (9.9) (17,550) (6.9) (29.8) Net Interest Income 6,862 2.7 8,007 3.1 16.7 Other Operating Income 804 0.
Slide 34: Summary P&L Information – Fourth Quarter 2003
Summary P&L Information – Fourth Quarter 2003 Q4 2002 Q4 2003 % of % of Rp (Billions) Av.Assets* Rp (Billions) Av.Assets % Change Interest Income 7,241 11.4 5,479 8.6 (24.3) Interest Expense (5,568) (8.8) (3,306) (5.2) (40.6) Net Interest Income 1,673 2.6 2,173 3.4 29.9 Other Operating Income 733 1.
Slide 35: Bank Mandiri's Credit Ratings
Bank Mandiri’s Credit Ratings S&P Moody’s Fitch Sovereign Ratings Outlook Stable Stable Stable Long Term Bank Deposits B3 Long Term Foreign Currency Debt B B2 B Long Term Local Currency Debt B+ B Bank Mandiri Ratings Long Term Foreign Currency Outlook Positive Stable Long Term Bank Deposits B3 Long
Slide 36: Bank Mandiri Additional Information…
Bank Mandiri Additional Information… 35
Slide 37: Ongoing Commitment To Strengthen Risk Management
Ongoing Commitment To Strengthen Risk Management … Development Development To To Date Date Future Future Action Action Plan Plan # Implementation of “Four-Eyes Principle” • Active Credit Portfolio Management # Improvement of credit policies (credit process, • Active Capital Allocation Management aut
Slide 38: Human Resources Capabilities & Corporate Culture
… And Human Resources Capabilities & Corporate Culture Description Description 2001 2001 2002 2002 2003 2003 Number Number of of Employees Employees 17,204 17,204 17,735 17,735 18,397 18,397 Violations Violations & & Sanctions: Sanctions: a. a. Warning Warning 1st 1st degree degree 191 191 191 191 2
Slide 39: Significant Progress in Creating a Dominant Retail Bank
Significant Progress in Creating a Dominant Retail Bank Customer Satisfaction Index Towards Overall Service Savings Deposits (Savings Product) (Rp Tn) 79% 40.5 68% 29.6 62% 22.1 2000 2002 2003 2001 2002 2003 Number of Credit Cards Consumer Assets Portfolio (‘000) (Rp Tn) Taken over in 2003 338 3.7 2
Slide 40: White-paper Milestones Progressing as Expected
White-paper Milestones Progressing as Expected Action Plan Deliverable Time-line Status 1. Appointment of independent Board of Commissioners with capital market expertise Appointed by Shareholders meeting Sep '03 ! 2. Completion of quasi re-organisation Decision by Shareholders meeting Dec'03 ! 3. C
Slide 41: Detailed Status on Ongoing Initiatives (1)
Detailed Status on Ongoing Initiatives (1) 5. Action Refinement of Plan quality control and internal audit • Continuous update on auditDetailed Status manual (every half year) to maintain ISO 9001:2000 certification • Continuous socialization of GCG principles and fraud method to mitigate future eve
Slide 42: Bank Mandiri Additional Loan Movement Detail
Bank Mandiri Additional Loan Movement Detail 41
Slide 43: Q4 2003 Loan Movement, Performing & Non-Performing Loans
Q4 2003 Loan Movement, Performing & Non-Performing Loans Performing Loan Movements - Bank Only Non-Performing Loan Movements – Bank Only IDR bn 3,201* 66,832 65,239 104 371 1,041 1,067 3,651 504 6,479 9 5,243 1,041 3,201 * Beg. U/G from D/G to NPL Net FX Impact End Beg. U/G to PL D/G from Disburse.
Slide 44: FY 2003 Loan Movement, Performing & Non-Performing Loans
FY 2003 Loan Movement, Performing & Non-Performing Loans Performing Loan Movements - Bank Only Non-Performing Loan Movements – Bank Only IDR bn 349 66,832 4,554 * 1,467 59,214 1,286 2,054 12,246 2,144 139 6,479 4,727 1,286 4,554 * Beg. U/ Gf rom D/ Gt o NPL Net FXImpact End Balance Beg. U/G to PL D/
Slide 45: FY 2003 Movement in Category 1 and 2 Loans
FY 2003 Movement in Category 1 and 2 Loans Category 1 Loan Movements – Bank Only Category 2 Loan Movements – Bank Only IDR bn 898 55,849 6,133 2,413 * 16,113 43,102 2,814 2,814 259 12,480 2,142 6,133 234 461 10,983 1,027 Beg. Bal. D/ Gt o 2 U/ Gf rom D/ Gt o U/ Gf rom Net FXImpact End Bal. Beg. Bal.
PT Bank Mandiri (Persero) — FY2003 Earnings Presentation on 6ix